Final Results of Changed Circumstances Antidumping Duty Administrative Review: Industrial Nitrocellulose From Korea

DEPARTMENT OF COMMERCE

International Trade Administration

[A-580-805]

Final Results of Changed Circumstances Antidumping Duty

Administrative Review: Industrial Nitrocellulose From Korea

AGENCY: Import Administration, International Trade Administration,

Department of Commerce.

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SUMMARY: On October 26, 1999, the Department of Commerce (``the

Department'') published the notice of initiation and preliminary

results of its changed circumstances administrative review concerning

whether Korea CNC Ltd. (``KCNC'') is the successor firm to Daesang

Corporation (``Daesang'') under the order covering industrial

nitrocellulose (``INC'') from Korea. We have now completed that review.

We have determined that KCNC is the successor firm to Daesang.

EFFECTIVE DATE: January 13, 2000.

FOR FURTHER INFORMATION CONTACT: Ron Trentham or Thomas Futtner, Office

of AD/CVD Enforcement, Import Administration, International Trade

Administration, U.S. Department of Commerce, 14th Street and

Constitution Avenue, NW, Washington, DC 20230; telephone (202) 482-6320

or (202) 482-3814, respectively.

SUPPLEMENTARY INFORMATION:

The Applicable Statute and Regulations

Unless otherwise indicated, all citations to the statute are

references to the provisions effective January 1, 1995, the effective

date of the amendments made to the Tariff Act of 1930 (``the Act'') by

the Uruguay Round Agreement Act. In addition, unless otherwise

indicated, all citations to the Department's regulations are to the

regulations codified at 19 CFR part 351 (1999).

Background

In a letter dated August 25, 1999, KCNC advised the Department that

on April 1, 1999, China Nitrocellulose Co. (``CNC'') purchased

Daesang's INC business, including Daesang's only manufacturing and

research and development (``R&D'') facility for subject merchandise

(``the Chonju factory'').

[[Page 2116]]

KCNC stated that CNC transferred Daesang's INC business to KCNC, which

CNC had newly established for that purpose. KCNC requested that the

Department conduct a changed circumstances administrative review

pursuant to section 751(b) of the Act to determine whether KCNC should

properly be considered the successor firm to Daesang. KCNC stated that

it operates the Chonju factory without change. Production continues

with the same equipment, the same workers, the same raw materials

purchased from the same suppliers, and the same production process.

KCNC stated that it continues to sell the same products to the same

customers to which Daesang previously sold. Further, the organizational

and management structure of Daesang's INC business has essentially

remained intact, except that KCNC has appointed a new president. All

management and employees at the plant manager level and below are the

same as when the factory was managed by Daesang, while the managing

director was formerly employed by Daesang in another capacity. In

addition, KCNC provided a copy of the Closing of the Asset Purchase and

Sale Agreement. KCNC also submitted a copy of the relevant schedules to

the sales agreement between Daesang and CNC, showing the transfer to

KCNC of Daesang's INC assets, contracts, customers, and suppliers.

On October 26, 1999, the Department published in the Federal

Register (63 FR 57628) the notice of initiation and preliminary results

of its changed circumstances antidumping duty administrative review of

INC from Korea. We have now completed this changed circumstances review

in accordance with section 751(b) of the Act.

On November 26, 1999, KCNC submitted comments with regard to the

Department's October 26, 1999, preliminary results. KCNC stated that it

believes that the Department's preliminary results are correct in all

respects. No comments were filed by the petitioner or any other

interested party.

Scope of the Review

Imports covered by this review are shipments of INC from Korea. INC

is a dry, white amorphous synthetic chemical with a nitrogen content

between 10.8 and 12.2 percent, and is produced from the reaction of

cellulose with nitric acid. INC is used as a film-former in coatings,

lacquers, furniture finishes, and printing inks. The scope of this

order does not include explosive grade nitrocellulose, which has a

nitrogen content of greater than 12.2 percent.

INC is currently classified under Harmonized Tariff System

(``HTS'') subheading 3912.20.00. While the HTS item number is provided

for convenience and Customs purposes, the written description remains

dispositive as to the scope of the product coverage.

Successorship

In considering questions involving successorship, the Department

examines several factors including, but not limited to, changes in (1)

management, (2) production facilities, (3) supplier relationships, and

(4) customer base. See, e.g., Brass Sheet and Strip from Canada; Final

Results of Antidumping Duty Administrative Review, 57 FR 20460 (1992).

While no one or several of these factors will necessarily provide a

dispositive indication, the Department will generally consider the new

company to be the successor to the previous company if its resulting

operation is essentially the same as its predecessor. See, e.g.,

Industrial Phosphoric Acid from Israel; Final Results of Changed

Circumstances Review, 59 FR 6944 (February 14, 1994). Thus, if evidence

demonstrates that, with respect to the production and sale of the

subject merchandise, the new company operates as the same entity as the

former company, the Department will treat the successor company the

same as the predecessor for antidumping purposes, e.g., assign the same

cash deposit rate or, if appropriate, apply any relevant revocation.

We have examined the information provided by KCNC in its August 25,

1999, letter and determined that KCNC is the successor-in-interest to

Daesang. The management and organizational structure of the former

Daesang have essentially remained intact under KCNC, and there have

been no changes in the production facilities, supplier relationships,

or customer base. Therefore, we determine that KCNC has maintained

essentially the same management, production facilities, supplier

relationships, and customer bases as did Daesang.

Final Results of Changed Circumstances Review

We determine that KCNC is the successor-in-interest to Daesang for

antidumping duty cash deposit purposes. KCNC, therefore, will be

assigned Daesang's antidumping duty cash deposit rate of 2.10 percent.

This deposit requirement will be effective upon publication of this

notice of final results of administrative review for all shipments of

the subject merchandise entered, or withdrawn from warehouse, for

consumption on or after the publication date as provided by section

751(a)(2)(c) of the Act. This deposit rate shall remain in effect until

publication of the final results of the next administrative review.

This changed circumstances review and notice are in accordance with

section 751(b) of the Act, as amended (19 U.S.C. 1675(b)), and 19 CFR

351.216.

Dated: January 7, 2000.

Robert S. LaRussa,

Assistant Secretary, Import Administration.

[FR Doc. 00-874 Filed 1-12-00; 8:45 am]

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